Weekly Investor – April 02, 2012
Searching for a Silver Lining
Market Summary:
The major U.S. equity markets remained relatively unchanged for the week. The S&P 500® rose to its highest level since mid-2008 but promptly fell as many investors opted to take profits in response to renewed concerns about global economic conditions. These concerns included fear over growth inChinaand a report stating thatGreecemay have to restructure its debt again. However,U.S. economic data remained positive with unemployment claims declining to a new low. Additionally, Fed Chairman, Ben Bernanke suggested that the Fed would be more stimulative if the economy faltered again, which greatly reduced concerns of a double dip. Finally, oil prices have remained roughly unchanged for nearly a month which is a positive for US manufacturing and consumer confidence. Ultimately, investors remain cautious as they struggle with mixed signals and look for a silver lining from Corporate America.
The S&P 500® closed down 0.8% for the week. The top-performing sectors in the S&P 500® Index included Health Care (+2.7%) and Utilities (+1.3%), while bottom-performing sectors included Telecommunications (-1.5%) and Energy (-0.5%). In the fixed-income market, the 10-year Treasury closed with little change for the week at 2.2%.
We continue to seek those companies possessing identifiable catalysts, and focusing on those stocks with favorable odds.
Profiing from Change
CBS Corporation (CBS) operates a worldwide mass media company and is headquartered inNew York,New York. Founded in 1986, CBS has operations in every field of media including broadcast television, cable television, radio, outdoor advertising, publishing, interactive media, and entertainment.
Recently, a structural change between content providers, such as CBS, and distributors, such as cable and satellite operators, has provided additional profitability for CBS. CBS now has the ability to leverage the value of its content when negotiating retransmission fees. In addition, increased demand for online content from video distributors such as Netflix provide a new and meaningful growth source for CBS. We expect CBS will successfully continue to generate value from its content, therefore creating favorable odds for our clients.
Top 10 Equity Holdings
| . | |
|---|---|
| MasterCard Inc. | 4.9% |
| Qualcomm Inc. | 4.3% |
| Biogen Idec Inc. | 4.2% |
| Monster Beverage | 4.1% |
| Jabil Circuit Inc. | 4.0% |
| Danaher Corp. | 3.9% |
| Google Inc. | 3.8% |
| Gilead Sciences Inc. | 3.7% |
| EMC Corp. | 3.6% |
| CBS Corp. | 3.5% |
U.S. Equity Indices
| Index | 03/30/12 | Week % Chg | YTD % Chg |
|---|---|---|---|
| DJIA | 13,212.0 | 1.0% | 8.1% |
| NASDAQ | 3,091.6 | 0.8% | 18.7% |
| S&P 500 | 1,408.5 | 0.8% | 12.0% |
| Russell 1000 G | 663.7 | 0.9% | 14.3% |
U.S. Credit Rates
| Index | 03/30/12 | 03/23/12 | 12/31/10 |
|---|---|---|---|
| 3 Month T-Bill | 0.1% | 0.1% | 0.1% |
| 5 Year T-Note | 1.0% | 1.1% | 2.0% |
| 10 Year T-Note | 2.2% | 2.3% | 3.3% |
| 30 Year T-Bond | 3.3% | 3.3% | 4.3% |
| Prime Rate | 3.3% | 3.3% | 3.3% |
This newsletter presents selected recommendations from portfolio managers of Argent Capital Management LLC, a registered investment advisor. Opinions reflect the portfolio manager’s judgment on the date above and are subject to change. A list of stocks recommended by Argent is available upon request. You should not assume that these recommendations are or will be profitable. In the course of it’s business, Argent’s client accounts may be buying and selling these stocks.
